Sunac China’s shares soar after property developer says debt restructuring conditions ‘satisfied’

Sunac says its bonds were exchanged for a combination of convertible bonds, dollar-denominated notes, mandatory convertible bonds and shares in its subsidiary

The company’s shares jumped as much as 27 per cent to HK$2.95 before closing at a two month high of HK$2.61, a rise of 12 per cent

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Apartment buildings at the Magnolia Mansion residential project, developed by Sunac China Holdings Ltd., in Shanghai, China. Photo: Bloomberg

Published: 2:17pm, 21 Nov 2023Updated: 5:23pm, 21 Nov 2023

Sunac China’s shares soared in Hong Kong after the troubled developer said it had satisfied conditions for a long-awaited offshore debt restructuring deal – the first of its kind since the crisis in China’s property sector erupted.

The company’s shares jumped as much as 26.6 per cent to HK$2.95 on Tuesday, before closing at a two month high of HK$2.61, a rise of 12 per cent which added HK$2.47 billion (US$320 million) to the developer’s market value. A gauge tracking mainland developers listed in Hong Kong advanced 2.1 per cent, after sliding to an all-time low earlier this month.

Sunac’s existing debt instruments were exchanged for a combination of convertible bonds, dollar-denominated notes, mandatory convertible bonds and shares in its subsidiary Sunac Services Holdings, totalling about US$10.2 billion, according to a filing on Monday.

The workout plan was approved by the High Court in Hong Kong last month. The revamp was backed by creditors representing over 98 per cent of claims during a September vote.

A worker walks past scaffolding at the Sunac Resort project construction site, developed by Sunac China Holdings, in Haiyan, Zhejiang Province. Photo: Bloomberg

The restructuring is a “landmark deal” and “marks a significant milestone for the Chinese property market”, as Sunac is the largest among the property companies seeking to restructure their debt, Sunac’s legal adviser Sidley Austin said in a statement on Tuesday.

Sunac China’s shares soar after property developer says debt restructuring conditions ‘satisfied’

Sunac says its bonds were exchanged for a combination of convertible bonds, dollar-denominated notes, mandatory convertible bonds and shares in its subsidiary The company’s shares jumped as much as 27 per cent to HK$2.95 before closing at a two month high of HK$2.61, a rise of 12 per cent

Sunac says its bonds were exchanged for a combination of convertible bonds, dollar-denominated notes, mandatory convertible bonds and shares in its subsidiary

The company’s shares jumped as much as 27 per cent to HK$2.95 before closing at a two month high of HK$2.61, a rise of 12 per cent